Neither the excellence of a single product nor Xiaomi’s experience can save Vancl

At the Vancl press conference on the 28th, Chen Nian finally shouted out, "Today, I stand here and let the past be the past." His choice was to let Vancl remove unnecessary "Eslite", simplify things, and reshape the "Vancl" brand from the so-called "single product extreme" of basic styles and the "Xiaomi model" in marketing.

This set of rhetoric and practices sounds very tempting. If VANCL can take the no-ironing shirts as a starting point, and use high cost-effectiveness and relatively high-quality products that meet the basic needs of the general public as a breakthrough, and then use the so-called "sense of participation" marketing secret that Xiaomi is good at, this set of Internet strategies can indeed bring VANCL back into the public eye. There are indeed many successful cases of single product extremes, such as the super popular UNIQLO. In the past, many Taobao brands also followed this approach.

It is not easy for Vancl to achieve all of the above, but for clothing e-commerce, the most critical part is really the operation of the industrial chain, including different aspects such as cost, product research and development, and traffic operation.

After listening to the press conference, I did not feel that Vancl had deviated from its "affordable fast fashion" positioning after returning to brand e-commerce. It is now more like a concentrated "Uniqlo", a "Uniqlo" for Internet people and entrepreneurs. Therefore, let's take a look at what is the most critical KPI for measuring the quality of "affordable fast fashion" brands?

E-commerce Jun believes that there are three points:

First, cost control ability, gross profit margin and unit production cost. The premise of "affordable" is of course that the price is popular, but price is not the only reference variable. From the perspective of consumers, "cost-effectiveness" is the real meaning of affordable. Therefore, merchants either provide higher quality products at a specific price or keep the price of specific goods as low as possible. Assuming that the "ultimate items" provided by Vancl are higher quality products, then judging from the current 129 yuan non-iron shirts, Vancl's gross profit margin may not be high. If it completely makes "ultimate items" and tries to keep the price as low as possible, it is an unsustainable way to lose money and gain publicity. At least Uniqlo will not do this.

Second, product R&D capabilities. That is, product sales rate, sales percentage of hot-selling products, and inventory turnover rate. How to design best-selling products in a streamlined manner is the core competitiveness of "fast fashion" brands. In this regard, Vancl seems to have found at least two types of products that may be best-selling: "three-piece suits" and "iron-free shirts", but can the products really be hot-selling and have large sales? Can Vancl control inventory turnover well? All of this depends on the level of Vancl's own supply chain management.

Third, traffic operation capability . That is, the cost of acquiring new users, user activity, and user loyalty. In the virtual business environment of the Internet, merchants need to operate brand users from scratch. In this regard, Vancl does not have much advantage. Vancl is famous, but in the minds of consumers, it has declined or disappeared for a long time. It almost needs to be treated as a new brand. In such a "red ocean" market for e-commerce and clothing brands, E-commerce Jun is very worried about Vancl's user traffic.

In the past, Vancl was relatively good at marketing, just like it is now, and it gained a lot of traffic, but it was not high. However, due to two other shortcomings, Vancl's user loyalty and product gross profit margin have always been low: one is that the product lacks competitiveness, and the other is that the supply chain management level is low. For "affordable fast fashion" clothing brands, the continuous launch of hot products (product research and development capabilities) and the level of supply chain management (cost control capabilities) are the real core competitiveness, and whether Vancl has achieved a qualitative leap in these two aspects is the real concern of e-commerce Jun. Vancl has not mentioned these aspects.

In addition, both the online retail and clothing industries have entered the mature stage of the market. Micro-innovations such as "single product perfection" cannot help Vancl carve out a path for itself, nor is there the so-called huge opportunity that Lei Jun had when he made smartphones to make Vancl take off again. Even if Vancl's products are getting better and better, its operations are becoming more mature, and its customer loyalty and activity are also very high, Vancl still faces a fatal problem: the company cannot achieve rapid growth because this market already belongs to brand giants such as Uniqlo, Zara and H&M, which occupy the vast majority of the market share in this category.

Therefore, if Vancl cannot forge core competitiveness in supply chain operations, then single product excellence and Xiaomi experience will not save Vancl. What is even more "bitter" is that even if Vancl does well in all aspects, it will not be able to become the leader or one of the giants in the category market, and can only survive as a "small and beautiful" company.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.